Car Loan A used car dealership specializes in selling cars to applicants with bad credit. Factors that determine whether a car loan is approved include the car price (in thousands) and the down payment (in thousands). A linear probability model (LPM) and a logistic regression model is fit to the data to predict whether an applicant gets approved for a loan. Estimated parameters for both models are given below. The response is a binary variable that is equal to 1 if the applicant is approved for a loan. Variable LPM Logistic Intercept 70 ' 30 71 ' 80 Down 0.39 0.9? Payment *0.03 *0.20 Car Price a. (3pts) Using the linear probability model, estimate the probability of a loan being approved when the Down Payment : $4,000 and the Car Price : $20,000? (Round nal answers to 4 decimal places) Probability: b. (3pts) Using the logistic regression model, estimate the probability of a loan being approved when the Down Payment = $4,000 and the Car Price : $20,000? (Round final answers to 4 decimal places) Probability: d. l2pts) Which one of the following statements about the linear probability model and the logistic regression model is true? 0 Both the logistic regression model and the linear probability model can yield probability estimates greater than 1 or less than 0. O Only the logistic regression model is guaranteed to yield probability estimates between 0 and 1. 0 Only the linear probability model is guaranteed to yield probability estimates between 0 and 1. 0 Both the logistic regression model and the linear probability model always yield probability estimates between 0 and 1. e. (2pts) Which one of the following statements about the linear probability model is true? 0 A) The linear probability model is fit by minimizing the sum of squares of the residuals. O B) The error terms included in the linear probability model satisfy standard regression assumptions. 0 Both A) and B) O Neither A) nor B) Stock Moving Average The price of a stock for the first 8 weeks of the year is as follows: Week Price 1 $2.1 $5.07 $8.24 $10.12 $12.87 $14.5 $17.87 $19.51 DON-JOSU'IbILHM a. (2pm) Compute a three-period moving average for these stock prices (in R, order = 3). What are the first two moving average values? (Round your answer to two decimal points) First: $ Second: $